When an employer is insolvent and administrators appointed, job losses are often an inevitable consequence. In this blog we look at the legal obligations arising where redundancies meet the threshold for collective consultation, and the implications for administrators arising out of the recent Supreme Court in the case of R (on the application of Palmer) v Northern Derbyshire Magistrates Court and another.
When does the legal obligation to collectively consult apply?
Employers who are proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less must comply with specific collective consultation obligations under the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA).
Whether or not this test is met is not always straightforward, particularly as ‘dismiss as redundant’ has a wide meaning to include any dismissals not related to the individual employee, so would include ‘fire and rehire’ dismissals in the context of facilitating a change to terms and conditions. Also, certain dismissals (e.g voluntary terminations) are counted, but others (e.g. expiry of a fixed term contract) are not.Continue Reading Collective redundancies on insolvency: administrators’ responsibilities and liabilities